Imagine that.
Amid the housing loan debacle, one segment of the mortgage market is solid: illegal immigrants.
As it turns out, home loans that don’t require legal status are among the safest risks that banks can take. According to The Wall Street Journal, ITIN mortgages - which immigrants can get with only a taxpayer ID number - have a delinquency rate of about 0.5 percent, roughly half that of prime mortgages and far below the 9.3 percent rate of subprime loans.
One reason for the high reliability of “individual taxpayer identification number” mortgages is that banks actually screen applicants thoroughly. Illegal immigrants, who don’t have valid Social Security numbers, typically must submit more documents than U.S. citizens, including payroll and tax records. Had banks checked subprime applicants this closely, a lot of today’s pain could have been avoided.
Another reason, according to the Journal, is the work ethic of immigrant families, most of them Latino. Immigrant households make it a priority to pay the mortgage before anything else. Illegals who worry about deportation don’t want the added risk of angering their bank.
I don’t doubt the work ethic of illegal immigrants, but they seem to motivitated by fear, as well.